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Flaherty takes flak for ‘hypocritical’ attacks on Ontario

A noted Toronto political scientist calls the federal finance minister’s actions before the tabling of the Ontario budget unprecedented.

Last Monday, federal finance minister Jim Flaherty called a press conference on the eve of Ontario’s budget day. He then strongly suggested what he wanted to see in Ontario finance minister Dwight Duncan’s budget, calling for corporate tax cuts, the elimination of the capital tax on business, and the harmonization of the GST with the provincial sales tax.

Dr. Nelson Wiseman, a political scientist at the University of Toronto, wonders what Flaherty and the federal Conservatives plan to gain.

“If this happened in Quebec, we would (immediately afterward) be having a national unity crisis,” he said. “I’m baffled, puzzled and mystified (by this move).”

Wiseman describes Flaherty’s intrusive call for the Ontario government to cut corporate taxes as “not very good retail politics.”

He also expressed alarm at what he suggests as Flaherty’s symbolic disrespect for the democratic will of Ontarians as expressed in the results of last year’s provincial election. Last October, Ontario voters returned Dalton McGuinty’s Liberals to government with a second majority.

While Flaherty was finance minister for the Progressive Conservative government in Ontario in 2002, he stated in his own budget at that time that he would “seek advice” on eliminating the capital tax. The capital tax applies to businesses whose combined assets and revenue exceed a certain amount above $1 million.

Flaherty himself did not opt to eliminate the tax while he served in the Harris government, although he did reduce it while in office.

Wiseman also points to Flaherty’s own record on harmonizing the PST with the GST, recognizing that Flaherty refused to harmonize Ontario’s sales taxes during his time in office at Queen’s Park.

“For (Flaherty) to ask the McGuinty government to do (what he refused to do himself) is hypocritical,” Wiseman said.

Wiseman also mused about Flaherty’s political motivations for continuing to wage a war of words with the Ontario Government. He dismissed the idea that Flaherty and the Harper government stand to gain any political points from this latest round of bickering with the province.

“The route to majority government is through Ontario,” Wiseman said. “I fail to see how they hope to achieve that by (fighting with the province).”